A new working paper has been added to the NOVAFRICA Working Paper Series.
Written by Cátia Batista and Pedro Vicente this paper analyzes the access to savings through Mobile Money.
Improving Access to Savings through Mobile Money: Experimental Evidence from Smallholder Farmers in Mozambique
Catia Batista and Pedro Vicente
Investment in improved agricultural inputs is infrequent for smallholder farmers in Africa. One barrier may be limited access to formal savings. We designed and conducted a field experiment in rural Mozambique that randomized access to a savings account through mobile money to a sample of smallholder farmers. All subjects were given access to mobile money and information about fertilizer use.
We also randomized whether closest farming friends were targeted by the same intervention. We find that the savings account increased savings, the probability of fertilizer use, by 31-36 pp, and the use of other agricultural inputs. We also show that the savings account increased household expenditures, in particular non-frequent ones. Our results suggest that the network intervention decreased social pressure to share resources and that the savings account protected farmers against this network pressure.
You can find more information here.